What next 4Kids?

Oct 01, 2002

By Sam Phillips

Al Kahn is the charismatic chairman and chief executive of 4Kids Entertainment. He is best known for discovering Pokemon and for being a pioneer in adapting Japanese popular culture for a global audience. Al joined Leisure Concepts Inc (the predecessor to 4Kids licensing) in 1988 and became the architect of 4Kids Entertainment, a vertically integrated group of companies spanning TV production, media buying, licensing and distribution. In January, 4Kids leased a Saturday morning programming block from...

The 4Kids model is to find properties that have been hits somewhere in the world and take them to a global audience, confident that a hit in one territory will be a hit somewhere else if it gets the right treatment. 'Kids are kids,' says Al Kahn. 'The issue is how you communicate with them. There are language and cultural differences, but the play patterns are the same.'

You went from being king of the Cabbage Patch todiscovering Pokemon. Where does your interest in Japanese Anime come from?

When I was working with Cabbage Patch Kids, I became interested in the video game phenomenon. At the time there were coin-operated video games in the US. Then we got Atari. And I realised that all the impetus and designs were coming from Japan. They originated from Manga (comic book) or TV shows and I noticed that the really popular stuff had never been exported, primarily because of language and culture differences. Japan was an area that hadn't been mined. So I started to develop relationships with Japanese companies, including Nintendo. Finally we began to acquire Japanese properties and take them to a wider market.

Can you define Anime?

That's very hard. It's a look that comes out of Japan. It has less movement per second than traditional US animation. Usually there are 52 episodes rather than 13-26 in the US. But the real essence of Anime is that it is driven by the story. Here, we are more visual and in Japan they are more story-driven; it is all part of the national culture. Before a Manga subject becomes a TV series, thousands of pages of comic book stories exist so the storylines are highly developed and the animators have a lot of material to work with.

Is Anime entrenched as a genre now?

I'm not sure kids really know it's Anime and they don't certainly don't know it's a genre. That's an adult talking. The Pokemon universe is different to the Anime universe. Things should be judged on their content not on their genre.

Why does Anime have to be adapted for the West?

Japanese Anime often has too much content that is culture-specific, or it might contain violence or sexuality that is inappropriate for a wider market. We take these elements out and remove the culture-specific material so it is suitable for global territories.

How are the shows adapted?

We re-edit scenes and re-score the music. Even the scene order can change. Sometimes the actual animation has to be altered, such as changing words on buildings or signposts. We think ahead so that re-dubbing for other countries is easier. It's a huge investment.

I've read internet petitions asking you to release uncut versions of Pokemon and Yu Gi Oh. Do you think there is a market for un-adapted Anime?

Yes, there is a market for pure Anime and we will release uncut versions of Pokemon and Yu Gi Oh on DVD for fans and collectors, most of whom are adults.

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www.4kids.com.

If you could have your Pokemon time again, what would you do differently?

Perhaps we'd not have so much licensing in some categories. There were some problems with control and a feeling of money grabbing. If we did it again I think we'd give broader coverage to fewer licensees.

How far do you think animation and video games have cross-fertilised?

They usually come from the same basic root, Manga. So they are both already extensions of the source material. Pokemon was unusual being a video game first, which was turned into a TV series. The usual pattern is to start as Manga, then video game, then TV.

Are you collaborating with Nintendo for anything new at the moment?

There's a game I'm very interested in called Animal Crossing in which you build an entire environment for animals. It's a bit like The Sims. It is only available in Japanese at the moment but it has depth and I see possibilities for extending it. When I'm looking at games' potential I'm looking for play patterns which can exist in new dimensions, such as toys or TV.

How early does the collaboration start?

With Nintendo, we get to see the game in its first Japanese version, not before. Nintendo's priority is the game and we get drawn in later.

How do you think the marriage between game and screen will develop?

I think it will continue as far as TV is concerned because there is an interesting factor to do with age. Kids who game play need agility. Three to five year olds might not be sufficiently adept to play the game but they can see the content on TV. This is what happened with Pokemon. And as I said before, the manga-driven TV properties make good games because the original material has entertainment value.

As far as cinema is concerned, I see more games coming from movies, but less movement in the opposite direction. For example, video games that are popular because of their violence or shock value are redundant as films. Resident Evil for example, is about shooting vampires. It's not a good subject for a film; you need a good story. On the other hand, Harry Potter and James Bond work well as games because every-one wants to be that person and the game gives you the opportunity to try it out.

Why haven't the big entertainment giants bought up the games company yet?

Early on they all had games divisions but soon realised that games and film require very different skills. Also, films always have a pre-sell: the story, its relevance or a celebrity lead. Games don't have that. It is true that the gaming industry is bigger than box office but it's not bigger than home video and entertainment as a whole. So I think the studios will continue to focus on how to take the best advantage of the game industry rather than doing it themselves.

Will 4Kids acquire or create a games company?

No. I know we can't do it. It's not our bag. It requires different people and different skills.

How important is licensing for your company revenue?

That depends on the cycle of the hottest property. Licensing always contributes the greatest revenue because it has the best margins. It might be 60-70% of our revenue when there's a very hot property, at which time home video also does very well.

Revenues have been dropping off since Pokemon's peak. Obviously this was expected but how do you project the next year?

It's becoming less of a one-horse race. Yu Gi Oh will kick in in the next six months so our revenues will grow. In the longer term I see us finding more hot properties and owning more content. That's our aim: to own more real estate like Cubix and Turtles.

You launched on the New York Stock Exchange in 2000. How compatible are the demands of the stock market with the peaks and troughs of entertainment and licensing?

The stock market likes a more projection-able growth and obviously we have ups and downs. We have to figure out how to level that off. That's why we created the Fox Box and home video division, to even up the downs.

How important is the UK market for 4Kids?

The UK market is critical because success in the UK points to likely success in Europe. We don't seem to do the same revenues out of the UK and Europe as we do out of the US and Canada so we have to work on this. There's a critical mass in the UK and an obvious synergy because of the language. We should be able to do well there.

In the future, we're going to try to do more business directly through the London office rather than via agents across Europe. Already retailers want to do business on a pan-European basis. For example, Toys R Us is opening across Europe and wants to do business from one source. McDonalds is the same story. I do believe things will become more pan-European. The UK will lose the pound and I see us putting business models in place for that eventuality. I can't stop people in one country ordering products from another country so increasingly we'll be fostering a one-territory approach.

How do you perceive the UK consumer of entertainment?

There are differences. Generally speaking, the UK consumer is used to softer TV and shows geared to younger audiences. There is less on offer in the hard-edged action field. Shows like the BBC's Ace Lightning are starting to target that market now.

Do you think our demand for homegrown content is a hindrance to companies like 4Kids?

No, I think there should be room for imports and home grown TV. And I love British TV. I watch BBC America and I love Manchild at the moment; it's a scream.

Will there be a Fox Box equivalent in the UK?

It's hard to imagine because the market isn't big enough for an exact equivalent. We'll definitely have all the shows but probably not on their own platform.

Cubix was your first homemade show. What will you make next?

At the moment we are busy with Turtles. There is a lot of clutter on US TV -- 1500 kids shows every weekend, for example. I think we should be making things kids know about. So the office is covered in lists of possibilities - books, toys, video games etc that could transform into good TV.

Cubix is doing well in the UK, perhaps better than in the US?

Cubix had a strange pattern of broadcast in the US, so didn't do so well. But it falls in line with what works in the UK because it's less violent and suits a younger audience.

Why are you remaking The Turtles?

Our business model says that if kids in the 1980s loved them today's kids will also love them if they are updated to be relevant.

Cynics here are saying: "Even 4Kids is re-hashing old properties". How do you respond to this?

But Turtles is a brand new show. Kids will see it as a brand new show. Licensees and retailers may remember it, which we hope will be a positive thing, but kids won't.

Turtles creator Peter Laird says they will go back to their comic roots. What does that actually mean?

Remember that the comic books were parodies. Peter picked the slowest animals on earth, named them after Renaissance masters and housed them in a sewer on a diet of pizza and bizarre sayings. It was irreverent and very cutting, very sarcastic. As it happened, children at the time took it all very seriously. We think this time we can go closer to the irreverence and aggressive tone of the original comic books while keeping the note of parody. We're putting the ninja back into the Ninja Turtles.

How have consumers changed since the last Turtles?

Kids haven't really changed. They just have more choices now and the one big difference we have to account for is aging down. Kids become more sophisticated more quickly and move on from things sooner than before.

Where do you think the next big cultural influence is going to come from?

I think it will come from another country. Perhaps China or Australia or India. Somewhere with deep-seated cultural stories that can find a way into the mainstream; somewhere where the culture has never really got out. We are hoping to have news of an Australian deal soon.